| Metric | This Period | Prior Year Period | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥1344.9B | ¥1299.9B | +3.5% |
| Operating Income / Operating Profit | ¥39.5B | ¥20.7B | +90.7% |
| Ordinary Income | ¥44.5B | ¥26.2B | +69.9% |
| Net Income / Net Profit | ¥34.0B | ¥15.3B | +121.9% |
| ROE | 5.6% | 2.7% | - |
For the fiscal year ended March 2026, Cleanup reported Revenue ¥1,344.9B (YoY +¥45.0B +3.5%), Operating Income ¥39.5B (YoY +¥18.8B +90.7%), Ordinary Income ¥44.5B (YoY +¥18.3B +69.9%), and Net Income ¥34.0B (YoY +¥18.7B +121.9%), achieving revenue growth and substantial profit increase. Gross profit margin improved to 32.9% (prior year 31.6%) up +1.3pt, and SG&A ratio declined to 29.9% (prior year 30.0%) down -0.1pt, resulting in an Operating Margin of 2.9% (prior year 1.6%) up +1.3pt. Penetration of price revisions and stabilization of raw material costs drove the gross margin improvement, while restraint in SG&A growth (+¥1.2B +3.1%) amplified operating leverage. Ordinary Income benefited from net non-operating additions of +¥5.1B (Non-operating Income ¥6.4B including Interest Income ¥0.5B; Non-operating Expenses ¥1.3B including Interest Expense ¥0.8B). Net Income was finalized after net extraordinary items of -¥0.5B.
[Revenue] Revenue was ¥1,344.9B (YoY +3.5%) and remained solid. Although segment disclosure is not provided, it is inferred that price revisions in core kitchen and water-related products have taken hold, and stable shipment volumes plus higher average selling prices supported revenue growth. Contract liabilities (advance receipts) were ¥9.0B, up ¥1.1B from ¥7.9B a year earlier, suggesting continued accumulation of backlog. Cost of sales ratio improved to 67.1% from 68.4% a year ago (-1.3pt), with peak-out in raw material prices (steel sheets, resins, wood, etc.) and pass-through effects contributing to gross margin improvement.
[Profitability] Gross profit was ¥442.2B (gross margin 32.9%), up ¥31.0B from ¥411.2B (31.6%) a year earlier, a +1.3pt improvement in gross margin. SG&A was ¥402.7B (SG&A ratio 29.9%), up ¥12.2B from ¥390.5B (30.0%) last year, but SG&A grew +3.1% versus sales growth of +3.5%, indicating containment of SG&A and effective fixed-cost leverage. As a result, Operating Income was ¥39.5B (Operating Margin 2.9%), a ¥18.8B increase (+90.7%) from ¥20.7B (1.6%) a year earlier. Non-operating items comprised Non-operating Income ¥6.4B (including Interest Income ¥0.5B) and Non-operating Expenses ¥1.3B (including Interest Expense ¥0.8B), netting +¥5.1B and yielding Ordinary Income ¥44.5B (YoY +69.9%). Extraordinary items included gain on sale of investment securities ¥1.9B recorded as Extraordinary Income, while loss on disposal of fixed assets ¥1.6B and other items produced Extraordinary Losses ¥2.5B, netting -¥0.5B. Pre-tax income was ¥44.1B, less Income Taxes ¥9.3B (effective tax rate 21.1%), resulting in Net Income ¥34.0B (Net Margin 2.5%), up ¥18.7B (+121.9%) from ¥15.3B (1.2%). In conclusion, the company achieved revenue growth and significant profit recovery driven by price realization and cost stabilization.
[Profitability] Operating Margin improved to 2.9% (prior year 1.6%) up +1.3pt, supported by gross margin improvement and lower SG&A ratio. Net Margin improved to 2.5% (prior year 1.2%) up +1.3pt; extraordinary items were minor and operating improvement translated directly to net profit. ROE improved to 5.6% (prior year 3.0%), primarily driven by higher net margin. ROA improved to 4.8% (prior year 2.9%). [Cash Quality] Operating Cash Flow / Net Income was 1.23x, indicating good cash backing of profits, but Operating Cash Flow / EBITDA was low at 0.48x, with working capital headwinds (Accounts Payable -¥29.6B, Accounts Receivable -¥7.2B, Inventories -¥6.0B) pressuring Operating Cash Flow. Depreciation was ¥47.6B versus Capital Expenditure ¥21.2B (CapEx/Depreciation 0.45x), indicating restrained replacement investment. [Investment Efficiency] Total Asset Turnover was 1.44x, maintaining good asset efficiency. [Financial Soundness] Equity Ratio improved to 64.7% (prior year 63.1%) up +1.6pt, and Net Assets increased by ¥33.4B to ¥604.4B. Interest-bearing debt was ¥60.6B (Short-term borrowings ¥15.0B, Long-term borrowings ¥45.6B), and with Cash and Deposits of ¥193.8B the company maintains a net cash position. Debt/EBITDA was 0.70x, and Interest Coverage was 51.9x (EBIT / Interest Expense), indicating very strong interest resilience. Current Ratio was 237.4% and Quick Ratio was 230.8%, reflecting very strong short-term liquidity.
Operating Cash Flow was ¥41.8B (YoY -3.8%), securing 1.23x of Net Income ¥34.0B, indicating good cash backing of profits. Operating Cash Flow before working capital changes was ¥47.6B, nearly stable versus ¥48.1B a year earlier, but working capital changes were a negative contributor. Specifically, Accounts Receivable increased by -¥7.2B (prior year a decrease of +¥4.3B), Inventories increased by -¥6.0B (prior year -¥2.1B), and Accounts Payable decreased by -¥29.6B (prior year -¥25.8B), resulting in roughly -¥43B of working capital outflow. The large decrease in Accounts Payable suggests changes in payment terms or timing effects at period-end. Income tax payments were -¥7.1B, within a normal range. Investing Cash Flow was -¥28.6B, including Capital Expenditure -¥21.2B, Intangible Asset Investment -¥14.0B, and proceeds from sale of investment securities +¥6.7B, indicating restrained replacement and growth investment. Financing Cash Flow was -¥7.5B, with long-term borrowings raised +¥60.0B and repayments -¥30.8B netting +¥29.2B, offset by short-term borrowings repayment -¥15.0B, Dividends Paid -¥11.2B, Share Buybacks -¥7.7B, and Lease Repayments -¥2.7B. Free Cash Flow (Operating CF + Investing CF) was ¥13.2B, covering Dividend Payments ¥11.2B at 1.18x, but Total Return including Share Buybacks ¥18.9B exceeded FCF by ¥5.7B, leading to adjustments via drawdown of excess cash or increase in interest-bearing debt. Cash and Cash Equivalents at period-end were ¥193.8B, up ¥6.1B YoY, indicating sufficient liquidity.
Ordinary Income exceeded Operating Income by ¥5.0B (Operating Income ¥39.5B; Ordinary Income ¥44.5B), with stable contributions from non-operating income (Interest Income ¥0.5B, Other ¥2.7B). Extraordinary items were net -¥0.5B and minor; gain on sale of investment securities ¥1.9B was temporary but largely offset by loss on disposal of fixed assets ¥1.6B, leaving results close to ordinary operating levels. Comparing Net Income ¥34.0B with Operating CF-based profit (Operating CF before adjustments ¥47.6B less non-cash expense adjustments), working capital volatility temporarily depressed CF conversion ratio, but the underlying quality of earnings is sound. Comprehensive Income was ¥52.4B, exceeding Net Income by +¥18.4B, comprised of Valuation Difference on Securities +¥6.5B, Adjustments related to Retirement Benefits +¥10.8B, and Foreign Currency Translation Adjustments +¥0.4B; remeasurement gains on pension assets and valuation gains on securities boosted comprehensive income. These are valuation fluctuations and should be distinguished from recurring operating profitability, but they can be regarded as contributing to improved financial soundness.
Full-year guidance projects Revenue ¥1,420.0B (YoY +5.6%), Operating Income ¥49.0B (YoY +24.1%), Ordinary Income ¥53.5B (YoY +20.1%), and Net Income ¥35.5B. An Operating Margin improvement to 3.5% (+0.6pt) is assumed, with continued price maintenance and cost-efficiency measures key to achieving the plan. Progress through the end of Q3 was 94.7% of Revenue, 80.6% of Operating Income, and 83.2% of Ordinary Income, indicating steady progress on both sales and profits. Dividend guidance was revised to an annual ¥13 (Interim ¥13 + Year-end ¥0 revised to Year-end ¥20 increased), resulting in a Payout Ratio of 65.0%, reflecting a policy to return profit growth to shareholders. Risks include re-escalation of raw material and logistics costs and fluctuations in the housing market, but at present the full-year plan appears achievable through sustained pricing strategy and fixed-cost control.
Dividends are set at annual ¥33 (Interim ¥13 + Year-end ¥20), unchanged from the prior year, with a Payout Ratio of 65.0%. Against Net Income ¥34.0B, total dividends are approximately ¥11.2B (Shares Outstanding 36,442 thousand - Treasury Shares 1,178 thousand), yielding a dividend payout ratio of approximately 32.9% on the current-year earnings; the guided Payout Ratio of 65.0% is consistent with the full-year Net Income forecast of ¥35.5B. Free Cash Flow ¥13.2B covered Dividend Payments ¥11.2B at 84.8% (dividend-to-FCF), but Total Return including Share Buybacks ¥18.9B exceeded FCF by ¥5.7B. This was adjusted by using excess cash or increasing interest-bearing debt (net long-term borrowings +¥29.2B), and while sustainable in the short term, sustained total returns will require expansion of FCF (improvement in Operating CF). With Cash and Deposits ¥193.8B, a net cash position, and Equity Ratio 64.7%, the financial position is solid and the sustainability of dividends is high. Share Buybacks ¥7.7B are positioned as a tactical capital policy, indicating a balanced shareholder return approach combining dividends and buybacks.
Operating Efficiency Risk: An Operating Margin of 2.9% is 4.8pt below the industry median benchmark (median 7.8%), and there is considerable room to reduce the SG&A ratio of 29.9%. Although containment of fixed-cost growth continues, upward pressure on labor and outsourcing costs could reverse operating leverage and slow the pace of margin improvement.
Cash Conversion Risk: Operating Cash Flow / EBITDA is low at 0.48x, with working capital movements (Accounts Payable -¥29.6B, Accounts Receivable -¥7.2B, Inventories -¥6.0B) pressuring Operating Cash Flow. The large decrease in Accounts Payable suggests changes in trade terms or period-end timing; if working capital management efficiency deteriorates, FCF volatility may increase and affect the sustainability of total returns.
Underinvestment Risk: Capital Expenditure ¥21.2B is only 0.45x of Depreciation ¥47.6B, indicating restrained replacement investment. While this supports short-term profit and cash flow, it risks medium- to long-term declines in production efficiency, delays in automation/labor saving, and relative competitiveness loss. Intangible asset investment (mainly software) is active at ¥14.0B, but progress of tangible asset renewal plans should be monitored.
Profitability & Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 2.9% | 7.8% (4.6%–12.3%) | -4.8pt |
| Net Margin | 2.5% | 5.2% (2.3%–8.2%) | -2.7pt |
Both the company’s Operating Margin and Net Margin are below the manufacturing median, indicating significant scope for profitability improvement.
Growth & Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 3.5% | 3.7% (-0.4%–9.3%) | -0.2pt |
Revenue growth is in line with the median, indicating an industry-standard pace of growth.
※ Source: Company compilation
Clear recovery in profitability: Gross Margin improved to 32.9% (+1.3pt) and Operating Margin to 2.9% (+1.3pt), led by price realization and stabilization of raw material costs. SG&A ratio also decreased to 29.9% (-0.1pt), enabling fixed-cost leverage. The company achieved substantial profit increases (Operating Income +90.7%, Net Income +121.9%), confirming improvement in the earnings structure. Full-year guidance is aggressive with Operating Income ¥49.0B (+24.1%), and continued pricing strategy and fixed-cost control are key to achieving it.
Balance of financial soundness and shareholder returns: With an Equity Ratio of 64.7%, a net cash position, and Debt/EBITDA 0.70x, the financial profile is robust with strong downward resilience. Total returns of ¥18.9B (Payout Ratio 65.0% on a full-year forecast basis plus ¥7.7B share buybacks) exceed FCF ¥13.2B, but given Cash and Deposits ¥193.8B and borrowing capacity, this level is judged sustainable. Going forward, expanding Operating CF (improving working capital management) will enhance the sustainability of total returns.
Room to improve operating efficiency and cash conversion: Operating Margin 2.9% lags industry median 7.8% by -4.8pt, indicating large scope to reduce SG&A ratio. Operating Cash Flow / EBITDA at 0.48x is low, and working capital movements (Accounts Payable -¥29.6B, etc.) compressed Operating Cash Flow. Capital Expenditure is only 0.45x of Depreciation and is restrained; planned, periodic execution of replacement and growth investments is necessary to maintain competitiveness over the medium to long term. Continuation of price maintenance and cost control, improvement of operating efficiency, and enhancement of cash conversion will be key focuses in the coming fiscal years.
This report is an earnings analysis document automatically generated by AI based on XBRL earnings disclosure data. It does not constitute a recommendation to invest in any particular security. Industry benchmark figures are reference information compiled by the Company based on public financial statements. Investment decisions are your own responsibility; please consult a professional advisor as necessary before making investment decisions.